Ryan Transportation, a longstanding truckload transportation provider, recently received a $2.5 million factoring facility from TAB Bank, according to a July 2 press release.
The company aims to improve its cash flow and working capital through the deal. Founded in 1970, Ryan Transportation is based in Livonia, Michigan, a western suburb of metro Detroit — not to be confused with the Overland Park, Kansas-based company with the same name.
The company recently reported 50 drivers, according to Federal Motor Carrier Safety Administration records, and provides transportation services for the automotive industry and select suppliers with a specific focus on the Great Lakes region, according to its website.
The company has three divisions: Cavalier Cartage, a city division serving the Detroit Commercial Zone; AXI Truckload, its interstate TL operation; and industrial switching, which provides onsite switching services.
In recent months, both the trucking and automotive industries have been challenged by tariffs, manufacturing weakness and ongoing inflationary pressures. A series of bankruptcies has also occurred as several trucking firms work to restructure their debts.
For companies trying to stay afloat, factor financing isn’t reliant on their creditworthiness, but rather the creditworthiness of their customers.
Factoring allows a business to sell its outstanding invoices as borrowing collateral, per Investopedia. A business buys the invoices and typically charges a fee to compensate for the risk of default by the borrowing company’s customers. In exchange, the borrower gets immediate liquidity, which can make a big difference in its short-term financial situation.
“TAB Bank offered us a straightforward financing solution that optimized our cash flow and enhanced our working capital, enabling us to keep our focus on running our business effectively,” Jennifer Orow, CFO at Ryan Transportation, said in the release.
